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Informist, Tuesday, Jul 30, 2024

 

By Sachi Pandey

 

MUMBAI – ICICI Bank reclaimed its position as the country's top corporate bond arranger in Apr-Jun after losing to close rivals Axis Bank and HDFC Bank in the preceding two quarters, according to data compiled by Informist. The private sector bank managed 51 bond issuances worth 177 bln rupees during the June quarter.

 

On its own, the bank arranged 13 deals worth 88.69 bln rupees during the quarter. The largest of these included a deal worth 22.75 bln rupees for Mahindra and Mahindra Financial Services and another worth 11.03 bln rupees for HDB Financial Services.

 

Axis Bank, which was the top corporate bond arranger in Jan-Mar, slipped to the second spot in Apr-Jun. The bank helped arrange 30 deals worth 157 bln rupees in the last quarter.

 

HDFC Bank was relegated to the third spot in Apr-Jun from second on the list of arrangers for the last quarter. The bank arranged 18 deals worth 145 bln rupees in Apr-Jun.

 

SBI Capital Markets bagged a close fourth spot with 19 issuances worth 144 bln rupees, followed by ICICI Securities Primary Dealership, which arranged 34 issuances worth 116 bln rupees in the quarter ended June.

 

A total of 1.77 trln rupees was raised through corporate bonds during the quarter, compared with 3.07 trln rupees in the preceding quarter, according to data with Informist.

 

JUNE

Last month, SBI Capital Markets made a surprising climb to the top of the league table, a spot usually occupied by one of the three largest private banks in the country. The last time SBI Capital Markets raced ahead of all other bond arrangers was in January, when it facilitated an additional tier-I bond offering by State Bank of India. This time too, it received a leg up from a solely arranged deal for State Bank of India.

 

SBI Capital Markets arranged nine deals adding up to 111.04 bln rupees in June, including 100 bln rupees raised by India's largest lender through 15-year infrastructure bonds. SBI's 15-year bond issue was the first infrastructure bond issue by a bank in 2024-25 (Apr-Mar).

 

ICICI Bank retained its second spot by arranging 19 deals worth 79.83 bln rupees. This included seven solely arranged seven deals worth 32.78 bln rupees for HDB Financial Services, SMFG India Credit Co, Godrej Industries, and Tata Power Renewable Energy. The private sector bank also managed to arrange 15 bln rupees for its own infrastructure bond issue. The bank raised a total of 30 bln rupees through 10-year infrastructure bonds at a coupon of 7.53%.

 

Axis Bank maintained its third position by arranging 11 deals worth 59.72 bln rupees in June. ICICI Securities Primary Dealership bagged nine deals worth 30.03 bln rupees, and stood fourth. HDFC Bank slipped to the fifth position from the top spot in May, arranging only five bond deals totalling 21.30 bln rupees. The bank was third in April.

 

Most bond arrangers jointly participated in big-ticket issuances of National Bank for Agriculture and Rural Development, IREC, Indian Renewable Energy Development Agency, Small Industries Development Bank of India, Indian Railway Finance Corp, and National Housing Bank.

 

Among state-owned entities, NABARD was the biggest issuer, raising 50 bln rupees through papers maturing in December 2029. It was followed by REC, which borrowed 40 bln rupees through bonds set to mature in July 2034. National Housing Bank and Indian Railways Finance Corp raised 32 bln rupees and 30 bln rupees through a September 2027 bond and a 10-year paper, respectively.

 

In June, private placements of corporate bonds declined marginally from May. This was attributed to a slowdown in credit growth, which is an indicator of economic activity, and uncertainty regarding the policies of a new coalition government leading issuers to adopt a cautious approach to new fundraising.

 

In June, corporations and financial institutions raised 663 bln rupees through 247 bond offerings, a 9% drop from 730 bln rupees raised in May, according to data compiled by Informist.

 

Year-on-year, fundraising through corporate bonds halved owing to the absence of major issuer Housing Development Finance Corp, which merged with HDFC Bank last year. In June 2023, issuers had raised 1.39 trln rupees through 230 bond issuances.

 

Yields on corporate bonds issued by the National Bank for Agriculture and Rural Development fell by 3-5 basis points across various maturities in June. The decline mirrored a similar trend in government securities, which saw strong buying interest from foreign portfolio investors.

 

Following is a list of corporate bond arrangers in order of the quantum arranged in Apr-Jun:

 

Apr-Jun
ARRANGER	ISSUES ARRANGED (SOLELY OR JOINTLY)	AMOUNT ARRANGED (IN BLN RUPEES)
ICICI BANK	51	177.335
Axis Bank	30	156.98
HDFC BANK	18	144.57
SBI CAPITAL MARKETS	19	144.23
ISEC-PD	34	116.08
AK CAPITAL SERVICES	43	52.88
TRUST INVESTMENT ADVISORS	42	33.61
PNB GILTS	28	31.68
YES BANK	18	19.85
TIPSONS FINANCIAL SERVICES	22	12.4
LKP SECURITIES	10	3.15
Others		*898.4
TOTAL		1,772.28

 

Following is a list of corporate bond arrangers in order of the quantum arranged in June:

 

June
ARRANGER	ISSUES ARRANGED (SOLELY OR JOINTLY)	AMOUNT ARRANGED (in bln rupees)
SBI Capital Markets	9	111.04
ICICI Bank	19	79.83
Axis BANK	11	59.72
ISEC-PD	9	30.03
HDFC BANK	5	21.3
AK Capital Services	15	20.58
PNB Gilts	10	11
YES Bank	5	10.55
Trust Investment Advisors	14	7.83
Tipsons Financial Services	9	5.85
LKP Securities	3	0.6
Others		*305
Total		663

 

End

 

Edited by Avishek Dutta

 

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